Asaak, a Ugandan asset financing startup, has secured $30 million in pre-Series A equity and debt funding.
The round saw the participation of new and existing investors including Resolute Ventures, Social Capital, HOF Capital, Founders Factory Africa, End Poverty Make Trillions, Decentralized VC and a number of angel investors.
Asaak, which started operations in Soroti Uganda in 2016, pivoted to motorcycle financing in 2019, offers motorbike financing to operators, who are often locked out by formal banking institutions due to stringent security requirements comprising income history and regular account activity. It’s founding team. include Dylan Terrill, Anthony Leontiev, Edward Egwalu and Kaivan Sattar.
The startup has so far financed the purchase of 5,000 motorcycles, and has also started providing smartphones and fuel financing to the operators.
The startup works with a number of partners including mobility and e-commerce platforms to make motorcycle ownership easier for the riders– who earn a living by operating motorcycle taxis (bodaboda).
Through Asaak, bodaboda operators are now able to own the motorcycles they ride, compared to previously when most of them were either employed by bike owners, or were renting or leasing the motorcycles.
“Asaak is unlocking mobility-based work, which literally moves the economy forward and creates upward mobility for these individuals. Bodaboda riders are the lifeblood of Africa, moving people and cargo from home to school to work. They just need access to motorcycles which leads them to better income opportunities and makes them able to provide for their families,” Asaak co-founder and chief business officer Dylan Terrill.
“By financing these types of assets, we’re not just creating a pathway to vehicle ownership, which is good in itself, but we’re creating a stable source of income because of the reliance of drivers throughout the countries that we are in.”
They are also working with Samsung to drive smartphone ownership among motorcycle taxi operators.
Last month, the company announced another partnership with Untapped Global, an investment company focussing on emerging markets to provide financing for more than 2,000 motorcycles over the next one year.
Furthermore, the startup has partnered with Standard Bank, headquartered in Johannesburg, South Africa and with a presence in 20 countries across the continent, to offer financial services to millions of workers (like motorcycle taxi operators) in the informal sector through the startup’s proprietary digital loan origination system.
Through this partnership Asaak customers will also have access to tailored services encompassing both finance and insurance. The partnership with the bank comes as Asaak plans to enter six new markets in Africa in the near future.
“While we often underestimate the power of the boda-boda (motorcycle transport) in Africa, in many circumstances, it is an ambulance, a pharmacist, and a chef – it brings you everything you need. It takes children to school, it brings people to job interviews, it provides livelihoods for hundreds of millions of Africans,” said Stanbic Bank, Standard Bank’s operation in Uganda, head of direct digital and e-commerce Aaron Akampa.
“Ultimately, this is new ground for Standard Bank – we haven’t partnered with any other players in this space on the continent yet – it’s the first time we are creating a partnership like this and we can’t wait to see what is ahead,” said Akampa.